How to Start a Company in Japan as a Foreigner: Process and Required Documents

If a foreign national wants to establish a company in Japan and come to Japan to manage it personally, they must not only set up the company but also obtain the “Business Manager” status of residence.

While it is possible to establish a company with as little as 1 yen in capital, there are unique considerations—such as the requirement of at least 30 million yen in capital to obtain a Business Manager visa.

This article explains the process and required documents for foreign nationals to establish and manage a company in Japan.

What Is Required for Foreigners to Establish a Company in Japan

What procedures are required for a foreign national to establish a company in Japan?

The company formation process is essentially the same for both Japanese nationals and foreigners. Immigration status is not a factor in company formation, so any foreign national, regardless of visa status, can establish a company in Japan.

What Visa Allows You to Run a Company?

However, once the company is established and you move on to actual business operations, the situation changes. Depending on your visa status, you may not be allowed to manage a company.

Among work-related statuses, those that assume employment by an organization—such as “Engineer/Specialist in Humanities/International Services” or “Specified Skilled Worker”—do not permit business management activities.

In addition, foreign nationals staying under statuses such as “Student” or “Dependent” are also not allowed to run a company. If you engage in business management under such statuses, it will be considered unauthorized work. Therefore, you must apply to the Immigration Services Agency to change your status to “Business Manager” (hereinafter referred to as the “Business Manager visa”).

Note that foreign nationals holding statuses such as “Spouse or Child of Japanese National,” “Permanent Resident,” “Long-Term Resident,” or “Spouse of Permanent Resident” are not subject to work restrictions and can manage a company under their existing status.

Can You Run a Company in Japan While Living Overseas?

Even a foreign national living overseas can establish a company in Japan. Therefore, it is not impossible to run a Japanese company while continuing to reside abroad.

However, if a foreign national receives compensation from a Japanese company and conducts business management activities in Japan, a Business Manager visa is required—even for short stays. It is not possible to repeatedly enter Japan on a short-term visa and manage a Japanese company. In addition, if the representative does not reside in Japan, opening a corporate bank account becomes difficult.

For these reasons, running a company in Japan while living overseas is generally considered highly challenging.

Company Formation Process

The process for establishing a company is as follows.

① Preparation and Notarization of Articles of Incorporation

The document that outlines the basic details of the company is called the Articles of Incorporation. Required items include the company name, business purpose, head office address, name of the incorporator, and total number of authorized shares.

Once prepared, the Articles of Incorporation must be notarized at a notary office with jurisdiction over the company’s head office location. Notarization is required only for joint-stock companies (Kabushiki Kaisha), not for limited liability companies (Godo Kaisha).

A registered seal and seal certificate are required for notarization, but a signature certificate can be used as a substitute if a seal certificate is not available. If you live overseas and your country does not use seals, prepare a signature certificate.

Foreign nationals staying in Japan long-term can register a personal seal at a local government office. If you already live in Japan, it is advisable to register your seal at this stage for future business operations.

② Payment of Capital

Deposit the capital into the incorporator’s personal bank account. The payment must be made after the date of preparation of the Articles of Incorporation.

The bank account used for capital payment must be a Japanese bank account (domestic or overseas branch) or a Japan branch of a foreign bank. This is not an issue for foreigners already living in Japan, but it is very difficult for non-residents to open a bank account in Japan. Therefore, securing a bank account is often a major hurdle, and cooperation from someone residing in Japan is typically required.

③ Company Registration

Register the company at the Legal Affairs Bureau. A company seal must be prepared before this step. The date of application for registration becomes the official company establishment date.

④ Notifications to Tax Office and Other Authorities

Submit required notifications to the tax office, municipal office, pension office, and other relevant authorities. If your business requires permits or licenses, obtain them from the appropriate regulatory agencies at this stage.

 

This completes the company formation process. The next step is applying for a Business Manager visa.

To obtain a Business Manager visa, you must complete company registration and obtain any required licenses before applying (except for the 4-month Business Manager visa). Therefore, the correct sequence is company formation first, visa application second.

Requirements for a Business Manager Visa

To obtain a Business Manager visa, you must meet the following requirements.

Let’s look at each requirement in detail.

Capital or Investment of at Least 30 Million Yen

Previously, 5 million yen in capital or investment was sufficient. However, due to the revision, this has been significantly increased to 30 million yen or more.

While it is possible to establish a company in Japan with just 1 yen, if you are a foreign national aiming to obtain a Business Manager visa, you should prepare at least 30 million yen in capital from the beginning.

The Manager Must Meet Experience or Academic Requirements

The business owner must meet either experience or academic requirements.

Specifically, one of the following must apply.

Employment of at Least One Full-Time Employee

The company must employ at least one full-time employee.

The employee must be a Japanese national, Special Permanent Resident, Permanent Resident, spouse of a Japanese national, spouse of a permanent resident, or Long-Term Resident.

Japanese Language Ability of the Applicant or Employee

Either the applicant or the full-time employee must have a sufficient level of Japanese language ability.

Specifically, a level equivalent to B2 or higher under the Japanese Language Education Framework is required. For non-Japanese nationals or non-special permanent residents, one of the following must be met:

Confirmation of the New Business Plan

The business plan submitted with the visa application must be specific, reasonable, and feasible.

In addition, it must be reviewed by professionals with expertise in business management, such as:

Securing a Business Office

You must rent a property under the company’s name.

The office must meet the following requirements:

Therefore, virtual offices or short-term rental spaces are not recognized as business offices. In principle, using a residence as both a home and office is also not permitted.

Required Documents for a Business Manager Visa Application

When applying for a Business Manager visa, the Immigration Services Agency places particular emphasis on business stability and continuity.

Therefore, the business plan is an extremely important document.

You will also need to submit documents proving the existence of the office, such as photos of the office (building exterior, entrance, mailbox, and interior) and the lease agreement.

In addition, you must submit documents such as the applicant’s resume, documents explaining the source of capital, company registration certificate, a copy of the Articles of Incorporation, minutes of the shareholders’ meeting approving executive compensation, and proof of capital payment. Contracts or agreements with clients or suppliers, if available, can strengthen your application.

Costs of Company Formation

For company formation, you must pay a registration and license tax of 150,000 yen (60,000 yen for a Godo Kaisha) to the Legal Affairs Bureau. In addition, you must pay a notarization fee of 30,000 to 50,000 yen to the notary office (not required for a Godo Kaisha).

Including miscellaneous expenses, the total cost is approximately 250,000 yen or more for a joint-stock company and 100,000 yen or more for a Godo Kaisha.

When applying for a Business Manager visa, the 30 million yen capital requirement is often a much bigger hurdle than the company formation costs. The source of the funds will also be examined, so you must prepare documents explaining how you obtained the 30 million yen.

Consult an Administrative Scrivener for Company Formation and Business Manager Visa Applications

When applying for a Business Manager visa, it is important to prepare your application with a clear understanding of the screening criteria. In particular, the business plan must be persuasive enough to satisfy the Immigration Services Agency. Preparing the Articles of Incorporation may also be very challenging for foreign nationals.

If you have any concerns about visa applications or company formation procedures, we recommend consulting an administrative scrivener with specialized expertise.